Does ‘Straight to Source’ spell straight to success for brands?
When it comes to selling products online, traditionally brands have been at the mercy of the retailer’s ecommerce store. Whilst this model worked when ecommerce was in its infancy, changing expectations of the online consumer has fuelled the rapid growth of a faster, more reactive and highly targeted channel – Direct to Consumer (D2C).
In a bid to meet the increasing shopper demands for instant gratification and personalised mobile shopping experiences brands have woken up to the fact that they must re-invent their ecommerce models.
D2C gives brands the opportunity to deliver the online experiences that their shoppers are looking for. Equally important, it enables brands to gather (and own) the first hand shopper data that is so vital in predicting how their shoppers will buy their products in the future.
D2C, with online platforms owned and managed by the brands, effectively bypasses the retailer. Though there is often an increased financial, and logistical burden of running their own online store, brands are able to balance this with the powerful position of owning first hand shopper data. Through D2C, brands reap real-time learnings that can be used to influence everything from live retail campaigns and product design through to the effectiveness of brand created content, social media and brand sentiment.
D2C platforms allow brands to optimise, in real time, the entire shopper path to purchase – something retailers will never be in a position to allow individual brands to do.
Unilever is a brand that clearly values the benefits of D2C. Their swift entry into the male shaving category with a recent $60M purchase of The Dollar Shave Club meant that along with a readymade product range and online store, they also bought 5 years worth of shopper data and one million engaged social media contacts. Smart move.
So, if we’re in an environment where more and more consumers are seeking to steer their own retail engagement experiences yet retailers continue to impose restrictions on how brands can sell their products, then opportunities for future brand success could lie in taking the shoppers’ D2C experience even further.
- Improving distribution
Competitive advantage will come down to service provision, primarily delivery performance. Deliveries will need to be swift and to locations beyond the home, offering consumers the convenience of receiving goods whenever, wherever they are.
- Increasing personalisation
Though greater personalisation means brands can segment their customers specialise and acutely target their offering, consumers are becoming far more aware of the value of their personal data. In return for sharing such details consumers will expect more control over what is shared with whom and greater rewards for sharing.
- More exclusives
The ability to discover and be rewarded with unique goods consumers cannot find in supermarkets or on the high street will elevate D2C brands. Almost 75% of consumers surveyed in the Center For Ecommerce Excellence’s recent ‘DTC Consumer Expectations Survey’ said they would shop D2C if they were able to buy unique products. Nespresso for example, offers dozens of exclusive items in their D2C webstore – flavours, gadgets and accessories you can’t buy elsewhere as well as exclusive services such as a recycling pick up service. https://www.nespresso.com/uk/en/
- Instant reactions
D2C continues to be a reactive, problem-solving channel. Stowaway cosmetic brand became famous for producing handbag-sized products where their D2C facilitated a ‘half the size, half the price’ consumer benefit. Brands that want to capitalise on the unique reactive speed of D2C must be able to keep pace with ‘quicker to market’ product launches.
- Truer brand content with more clarity
The D2C environment allows brands to sell their products their way, in their words and in the absence of expert sales assistants talking consumers through specific product benefits, a brand’s D2C offering must be clear and simple. Genuine, believable opinion – many D2C sites host vlogger opinions that connect with consumers. It’s not the brand telling you how great it is, it’s someone just like you.
- Subscription based models
The Subscription Economy is big news, offering increased sales and customer loyalty benefits for a multitude of product categories. Leveraging predictive analytics will also take product recommendations to the next level by providing a fully curated shopping experience.
- A theatrical shopping event
Consumers are seeking an environment where the D2C shopping is an event experience in its own right. Interactive, highly engaging content means the actual shopping experience is as stimulating as owning the product. Look no further than the charismatic personality of the Dollar Shave Club.
- Moving D2C into the real world
Physical shopping spaces whilst giving customers the opportunity to experience the reality of the brand, have also been proven to build consumer confidence. For many customers, one visit will be enough to build the trust necessary to make future purchases without needing to physically see and feel each new product.
According to a study by Forrester Research conducted on behalf of Digital River, 52% of consumers are already visiting manufacturers’ websites intending to make a purchase, and a third of those actually would prefer to buy from the manufacturer.